Arun Jaitley Fears Hoarding as Probability of Drought Looms in India

In light of drought forecasts, Jaitley asked the state governments to take effective measures to crack down hoarders and black marketers.

Drought looms over India as many parts of the nation is expected to witness below normal rainfall. [Representational Image]Reuters

With forecast of probable drought in West and Central India, the finance ministry has blamed the hoarders for taking advantage of the deteriorating weather and asked the state government to bust black marketing.

In a recent prediction by a weather forecast agency Skymet, North-west and Central India is at the threat of facing drought due to worsening monsoon and El Nino, a climate phenomena occurring due to exceptionally warm temperature of the Pacific Ocean, approaching closer, according to IBN.

The weather forecast report by the Skymet shows a probability of 80 percent drought in North-West India and 75 percent in Central India. The South-west monsoon, which is said to enhance the rainfall further to other parts of the country, has been weak this year. This has affected the summer crops — rice, soybean, cotton, pulses, sugarcane — that has to be sown ahead of monsoon.

If the condition continues to worsen, the economy will have to suffer as India will need to increase imports, cut down export and face food inflation and hoarding, the most concerning factor that has been worrying Indian Finance Minister Arun Jaitley.

Jaitley said that hoarders are taking advantage of the poor monsoon forecasts and has asked the state governments to take immediate actions against them.

"When production of food items is higher than last year and still prices rise, then it means that intermediaries are keeping the stock somewhere. There are reports of below normal monsoon this year. Hoarders are taking advantage of the situation," Hindustan Times quoted Jaitley.

He has asked the state governments to keep a track of supply-demand in the market and be ready with strategies to meet the demands. He reportedly said that the "production is at record level and supplies are adequate," so there must not be any prise rise.

The news reports also hint at the shortage of electricity as the scanty rainfall will affect the hydroelectric plants. The dairy sector is also suffering, as cattle are not getting the nutritional moisture in the fodder due to insufficient rainfall. Farmers are reportedly said to sell their cattle if the monsoon ditches them during the crop sowing in summer.

Jawaharlal Nehru University Assistant Professor Himanshu believes that the condition can resume to normal if the monsoon recovers in July.

"If the monsoon does not recover in July like it's expected to, then food crop production will suffer the most. But it is too early to say anything right now; the poor monsoon till now will not matter if it picks up in July," he told Mint.

However, Meteorologists hold a different opinion regarding the change in weather. They believe that the weather condition is likely to boost up but not drastically. The rainfall is expected to be scanty throughout with 70 percent chance of El Nino hitting Indian region.

Several scientists have been reported comparing this year's weather condition with the one India faced in 2009. They have raised concerns over the similarities between both years' El Nino.

In 2009, similar conditions prevailed in the country with subdued rainfall activity and El Nino eventually leading to drought. The year 2014 too has faced acute shortage of rainfall by 43 percent in the month of June, which is not likely to improve in the left three monsoon months.